Amazon seems to be dabbling in all kinds of entertainment services, content, and connections over the last few years. But is there a real long-term plan at work?
Cash-rich companies can do this. And just to confirm this approach, it's not always about those shiny, new digitally connected pixels. Sometimes you have to take an old-school approach.
Amazon is now considering buying or taking a major stake in a movie theater chain -- AMC Entertainment, the largest owner of U.S. movie theaters, according to reports.
This comes two years after its deal to purchase MGM Studios in a $8.45 billion agreement that closed May 2021.
In the fall of that year, Amazon moved into another direction, setting out not just to put its own brand name on TV sets from the likes of Toshiba, Insignia, and Pioneer but to manufacture its own TV product, pushing its Amazon Fire TV Omni brand.
Of course, we haven't forgotten all of the digital equipment/digital video services in the home and via mobile platforms -- Amazon Prime Video, Amazon Alexa (Echo Dot, Echo Show), Kindle and other screens. New innovations continue to come around these products.
Just like its core e-commerce business, cash-rich Amazon seems to want to own as many different screens as possible -- legacy, digital, and otherwise. But it has its limits -- especially when it comes to older legacy businesses like broadcast or cable TV networks. This is an apparent no-go, at the moment.
The obvious connection for Amazon and AMC Entertainment is around its MGM Studios deal.
But buying into AMC alone -- even with its dominant 37% market share when it comes to total movie theater box-office revenue -- will not completely allay all potential distribution issues when it comes to movies that Amazon wants to produce.
While starting up TV set manufacturing or buying a Whole Foods retail brick-and-mortar food chain may seem to be a way to dabble in these businesses, there is more going on. Like Apple, it looks to lay the groundwork for real long-term, steady future growth -- more so that traditional media companies.
Think about legacy media companies' current situation -- Walt Disney, Warner Bros. Discovery, Comcast's NBCUniversal, Paramount Global -- all of which seem to be in frantic rush to quickly transition out of legacy media businesses that are quickly dying.
Amazon and Apple have very different perspectives -- and effects. It seems the potential hiccups do not fluster their investors or customers.
Is that what we should hope for when it comes to future media companies that we want to believe in?